The strong demand for copper will push prices to grow 25% by next year to meet the needs of building infrastructure for artificial intelligence and the low-carbon transition, driving growth for miner Freeport-McMoRan (NYSE: FCX).
Copper prices started to surge late in 2025 and have slowed down recently due to concerns that the war in Iran could stymie growth in the global economy.
Shares of the company rose by 39% during the past year, but have pulled back in the past month, declining by 11%. The overall stock market has seen a setback due to worries that higher oil prices will hinder the economy from expanding.
Copper used in data centers, electric vehicles
The demand for copper remains high since the metal is used in the wiring, cooling, and power distribution at data centers, electric vehicles, renewables, and investments made in the electricity grid, which could increase copper prices in the future, wrote Jon Mills, an equity analyst for Morningstar Australasia.
Sales of copper are estimated to increase by 1.3 million metric tons in 2030, compared to 1.1 million in 2025, he added. The miner also sold 530,000 ounces of gold and 74 million pounds of molybdenum.
Freeport-McMoRan is a larger miner, owning stakes in 10 copper mines globally. Three of these mines are the largest in the world — 49% of the Grasberg copper and gold operations in Indonesia, 55% of the Cerro Verde mine in Peru, and 72% of Morenci in Arizona. The company reported that 80% of its revenue came from copper, while 15% was from gold.
Additional mining will produce a higher amount of output, “driven by Grasberg returning to full production of about 350,000 metric tons in 2028 and increased production from low-grade stockpiles primarily located in North America utilizing new leaching technologies,” Mills said.
The volume of gold being mined is estimated to rise to 610,000 ounces in 2030 from 530,000 in 2025, also due to the Grasberg mine.
Copper has emerged as a metal that “everybody seems to want,” to achieve their goals of increasing electrification and increasing the number of data centers, analysts at Bank of America said in a March report.
While gains in the price for the commodity have slowed down, the amount of copper needed to build data centers, offices, homes, and EVs will only increase, pushing prices higher again by next year.
Bank of America estimates that copper prices could rise to $7.26 a pound by the second half of 2027, which is nearly a 25% gain compared to current prices.
The current price of copper could be at the start of a bull market for the metal, said Kevin Smith, chief investment officer of Crescat Capital, which owns shares of Freeport-McMoRan and other precious and base metals miners, according to a Barron’s article.
Investors should view the lower stock price for the miner as a “buying opportunity” since he believes that the commodity could see a gain of 20% to 25% from its current price, he said.
Wall Street analysts have estimated that the earnings of Freeport-McMoRan will increase by 30% in 2027 to $3.71 a share. The stock is rated buy or outperform by 20 analysts, with only five who rate it hold, underweight, or sell.
Analysts have estimated a profit of $2.85 a share for 2026, an increase of over 60% from 2025.
Christopher LaFemina, an analyst at Jefferies, touts Freeport-McMoRan as a top pick in the mining sector, increasing his price target to $76 a share. He believes the company will produce “a recovery in Grasberg production alongside a structurally higher copper price over time to drive meaningful upside” to shares of the company.
Freeport-McMoRan’s production guidance figures are “beatable,” even though the Grasberg mine in Indonesia will not reach 100% production capacity until the end of next year.
Bank of America said Freeport-McMoRan’s stock “stands out as relatively inexpensive…compared to large-cap copper peers.”
The company’s stock trades at 21 times 2026 earnings estimates. Its rival Southern Copper (NYSE: SCCO) produces a forward price/earnings ratio of about 29.
Higher copper prices will boost the company’s profit margins, but investors should expect some volatility in the near-term. The situation in Iran remains uncertain, and if it escalates, crude oil prices could rally even more.
The demand for copper remains strong with no signs of it waning as the commodity is a crucial element for building AI infrastructure, plumbing, energy efficiency, and EVs, benefiting Freeport-McMoRan.
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